Why Do You Need a Loan Broker?

 In Blog

David Stannard Brown

There is a wide range of options available to homebuyers and homeowners who need refinancing. Apart from approaching an established mortgage broker, there are the traditional financing facilities recommended by banks and other institutions such as credit union, community bank, an online lender, or an established lender specializing in mortgage loans.

This is a choice that could lead to some confusion if you are not fully aware of the differences in services offered by each entity and it would be wise to enlist the help of the best mortgage broker.. The recognized publication “Inside Mortgage Finance” reported that for every 10 homes that originated in 2013, at least one of them was through the help of a loan broker.

Financial Expert Protection

A mortgage or loan broker acts as a middleman between the borrower and the lender who would find the loan. If you are a first-time homebuyer, you can also go directly to a lender, but is also recommended that you consider other options that could help you secure that loan. Many borrowers prefer to enlist the services of a recognized mortgage broker because their services include searching for the lender that could offer the best loan terms.

Perhaps the answer to this issue is to compare the different advantages and benefits offered by the various financial loan providers, including a mortgage broker. If you are considering most other services that can significantly affect you and your lifestyle, may that be a new doctor or an insurance policy, you would usually make a comparison among the service providers on your list! It is, therefore, logical to follow the same criteria when you are considering something as important as home financing!

If you conduct some financial research you will soon discover that no matter what the type of property you are seeking, or the loan period you require, lenders will have different interest rates or payable fees.

Ideally, it is wise to compare the terms and conditions given by at least three lenders. This process can be time consuming and sometimes frustrating, but a reliable mortgage buyer can help you decide which one you should go with.

Loan Issues

Should you be restricted in any way from qualifying for a loan because of a credit issue, irregular work history, high debt-to-income ratio, or self-employment? If your problem is one of those, then seeking the help of a mortgage broker is your best option. This would increase the alternatives available to you with greater variations in loan costs.

There are various programs and different thresholds determined by lenders regarding their perceived loan risk factors. Accordingly, while one provider may reject your application, another may review your circumstances and credit worthiness differently and approve your loan. This is a situation in which the knowledge and market-related experience of an established mortgage broker can make the difference.

However, it should also be kept in mind that if you do not qualify for a loan at this time, due to a particular issue, then generally it must be rectified before you can borrow money to buy a home. Again, this is an area in which the mortgage broker can offer you some valuable advice.

Broker Experience

An experienced loan broker will be able to help you complete the financial information and documents required by different lending sources for your loan application. Whether you’re a first-time buyer or just seeking for refinancing, your mortgage broker should be able to assist you by explaining all your available loan options and the programs that could be most financially beneficial to you. Although the majority of lenders offer similar assistance, they can only present programs that their respective institutions offer. Mortgage brokers, on the other hand, know a comprehensive range of options offered by lenders.

When you have made your decision with regard to which loan best suits your needs, your broker could help you communicate with the lender to complete the application process. Should any issues arise during the loan-underwriting phase, your loan broker will negotiate with the lender in a bid to resolve any obstacles and coordinate the necessary details. The mortgage broker will also manage the final stage of loan securement.

For a new homebuyer, attempting to secure a loan on his/her own can be a long,  difficult, and time-consuming process. The experienced loan broker can help make the experience a relatively smooth one.

The Best Mortgage Broker

The process of finding a reliable mortgage broker should be undertaken with due diligence. Therefore, a recommendation from a reliable source is of value. However, in any event, it could be in your interest to obtain references, interview the shortlisted brokers, and check their credentials. Doing these could give you peace of mind that you will find a professional, established, and trustworthy broker who could help you all throughout your loan application.

When you have found the perfect broker, you will receive feedback every step of the way. You won’t have to anxiously wait for lenders and institutions to call you or you will no longer have to contact them and lose your temper because of the tedious application process that they have, only to find out that your request will just be turned down in the end.

A mortgage broker knows how to handle various client situations and based on their requirements, the broker will give them the best possible options available. A mutual relationship that’s built on trust and professionalism.


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